BIFR Full Form
What is Full Form of BIFR ?
BIFR is the abbreviation used for the Board for Industrial and Financial Reconstruction. It was a development finance body under the ownership of the Ministry of Finance, created under the provisions of the Sick Industrial Companies Act (SICA), 1985. Its primary focus was to recover and reshape sick undertakings or to shut down and liquidate the sick-performing assets.
About BIFR
The BIFR consisted of a chairperson and 2 to 14 other representatives.
Elected High Court judges or Individuals, having professional experience of 15 years or more, are the prerequisite criteria to be a member of BIFR.
The Board was responsible for overseeing only large or medium-sized sick industrial enterprises in which a large amount of money was lost.
Background Of BIFR
Industrial sickness in India began in the pre-independence days. The Indian government and agencies tried to combat it in the initial days with certain ad-hoc procedures that included the nationalisation of banks to provide provisional assistance.
In 1985 SICA came into existence, and BIFR was also set up under the provisions of SICA in January 1987.
Another financial body was set up called The AAIFR (Appellate Authority for Industrial & Financial Reconstruction) in April 1987.
During 1991, under the provisions of SICA, Indian government companies were adopted only But afterwards, both public and private companies and organisations with occupational sickness cases were considered.
In 2001 The Amendment Bill was introduced when the government realised that the BIFR was not able to achieve its objectives of precautionary industrial sickness firms.
In 2003, the Repeal Act on Sick Industrial Companies was passed, which took the place of SICA and proposed to replace BIFR & AAIFR with NCLT (National Company Law Tribunal) and NCLAT (National Company Law Appellate Tribunal), respectively.
Functions Of BIFR
The main functions of the BIFR were:
To identify and assess the financial health of sick industrial companies and to provide a platform for the resolution of their financial difficulties.
To provide for the rehabilitation and revival of sick industrial companies through a combination of financial and operational restructuring measures.
To provide for the closure or liquidation of sick industrial companies that are beyond the point of rehabilitation.
To coordinate with various financial institutions and banks to provide financial assistance to sick industrial companies.
To work closely with the state government and other government agencies to create an enabling environment for the revival of sick industrial companies.